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Cohen’s Plea Suggests Russians Held ‘Kompromat’ on Trump

(Bloomberg) -- Michael Cohen’s latest guilty plea revealed a closely guarded Trump business secret. But in a deeply uncomfortable turn for President Donald Trump, one of the people in the know was an aide to Russian President Vladimir Putin.

Thursday’s dramatic turn of events is problematic for Trump because it suggests the Kremlin knew something that people around Trump were working hard to hold close -- that Trump was moving forward with a Moscow business deal at the same time he was deep in the race for the U.S. presidency. Any undisclosed foreign arrangements would raise red flags about candidates for national office, making them vulnerable to blackmail by others privy to those secrets. Russians call such nuggets of damaging information “kompromat,” a concept that’s become familiar enough to enter the international lexicon.

Whether Russia used such information is a matter for speculation. But Cohen’s revelation shows that Special Counsel Robert Mueller is digging deep into financial relationships between Trump’s business and Moscow, taking him to the heart of the connections he was appointed to explore between Russia and Trump’s campaign.

The Moscow real-estate deal Cohen described Thursday was under consideration through June 2016, five months longer than he’d had previously admitted. By then, Trump was already surging toward the Republican nomination for the U.S. presidential race. Russia had already embarked on efforts to support Trump’s candidacy through hacking and social-media manipulation, according to previous filings by Mueller.

The public deserves to know if elected officials have conflicted motives or interests in their decision-making, and whether other governments have leverage over elected officials, said former Manhattan federal prosecutor Mimi Rocah.

“Trump has long acted like someone over whom Putin has leverage,” Rocah said. “Now we know he very likely did in one specific way. And I’m guessing there will be more we learn about.”

The idea that Trump could be vulnerable to kompromat has come up before, most famously in the so-called Steele Dossier. The dossier’s most explosive claim, that the Kremlin has a recording of a sexual nature that would compromise Trump, hasn’t ever been verified. The less lurid detail that Cohen offered up in his guilty plea, however, is still potentially powerful.

Trump has denied having any business deals in Russia, and said Thursday that Cohen was lying.

Tower Plan

Cohen said he and a partner pursued the plan to build a Trump tower in Moscow through the middle of 2016. He said he briefed Trump and family members along the way, even discussing with Trump a trip to Moscow. That was at odds with what Cohen told lawmakers last year -- that he hadn’t told the family about the plan, characterizing it as dead by January 2016.

Cohen said he lied out of loyalty to Trump, who is referred to in court documents as “Individual 1.” The lies, Cohen added, were consistent with Trump’s political messaging at the time about his relationship with Russia and Russians.

What’s notable about Cohen’s admission, as presented by Mueller’s team, is that Russians, too, knew about the real-estate plan.

In his plea deal, Cohen described sending an email in early 2016 to a Russian official -- who has previously been identified as Dmitry Peskov, a Putin aide and press secretary -- about the project. He described receiving an email in response from Peskov’s office and said he subsequently spoke on the phone for about 20 minutes to a woman there. She asked questions and took notes, according to documents filed Thursday, and promised to follow up on Cohen’s proposals.

After Cohen’s call, his partner in the effort, Felix Sater, emailed him about Putin. “They called today,” Sater wrote, according to the filings.

The discussions with Moscow continued over the next five months, culminating in an invitation from Peskov’s office for Cohen to attend the St. Petersburg Forum in June 2016, where Cohen would be introduced either to Putin or to Prime Minister Dmitry Medvedev.

In mid-June, Cohen informed Sater that he wouldn’t be traveling to Russia after all, without explaining the reason.

That account is at odds with what Cohen told lawmakers in August 2017 -- that he didn’t recall receiving any response from the Russians in early 2016 and that he decided to abandon the project shortly thereafter.

Around the same time that Cohen downplayed the deal with lawmakers, Peskov went public with an account mirroring Cohen’s. The Kremlin received an email from Cohen seeking help with a Trump Tower project, Peskov told reporters on a conference call in late August, adding that the office never replied to it.

“We don’t respond to such business topics. It’s not our job and we left it without a response,” Peskov said at the time. Peskov also said the Trump Tower Moscow project was never discussed with Putin.

On the Lookout

National security officials in the U.S. are constantly looking for any instances where members of an administration could be blackmailed by a foreign power. One of the fundamental purposes of government background checks is to determine whether a would-be federal employees could be vulnerable because they have secrets they’re trying to keep.

President Trump had to deal with a similar issue involving General Michael Flynn, his first national security adviser. Prior to Trump’s inauguration, Flynn had spoken with Russian ambassador Sergei Kislyak. The FBI later interviewed Flynn at the White House, where he denied that he’d discussed sanctions that then-president Obama had just imposed on Russia.

After reports of the Kislyak conversation emerged, Vice President Mike Pence defended Flynn publicly, saying the national security adviser had assured him he hadn’t discussed policy with Kislyak.

After determining that Flynn had lied to the FBI agents about the meeting, then-acting Attorney General Sally Quillian Yates informed White House general counsel Don McGahn that she was concerned Flynn had lied to Pence.

Asked by McGahn why Flynn’s lie to Pence should be of any interest to the Justice Department, Yates explained that the Russians were aware that Flynn had lied to Pence, and could use that information to blackmail him.

“To state the obvious, you don’t want your national security adviser compromised with the Russians,” Yates told a congressional committee last year.